After-tax 401(k)

An After-tax 401(k), also known as a Mega Backdoor Roth IRA, is a type of deferred 401(k) subaccount, with different rules from traditional and Roth 401(k) accounts. They are typically used in strategies to rollover money to Roth IRAs far in excess of normal contribution limits.

After-Tax 401(k) limits

Traditional and Roth accounts share a employee contribution limit up to $18,000 per person for 2016 and 2017.
However, Section 415(c)(1)(A) limits total contributions to defined contribution plans to $53,000 in 2016 and $54,000 in 2017.[2]
The limit for an after-tax 401(k) is the difference between the amount already contributed by the employer and employee, and the Section 415 limit.

Notes

↑An event that a participant in a qualified plan must experience in order to be eligible to receive a distribution from a qualified plan. For most 401(k) plans, the triggering events are:

Attaining retirement age

Termination of employment (you are no longer employed by the company that offers the 401(k) plan in question)

Death - in this case, your beneficiaries are allowed to distribute your assets

Disability - the document that governs the 401(k) plan generally provides a definition of "disability"

Your employer terminates the 401(k) plan and does not replace it with another qualified plan